The New York City Council passed a law, which will become effective 180 days after it is signed by Mayor Bill de Blasio, that prevents employers from inquiring into a prospective employee’s pay history during the hiring process. This restriction is based on the idea that the use of a candidate’s previous salary to make a wage offer could lead to gender-based wage discrimination.
The new law prevents NYC employers from directly asking applicants, either in-person or via application materials, about previous earnings. Additionally, employers may not make wage inquiries to a candidate’s current or prior employers, nor may they conduct a public records search that may reveal a candidate’s pay history. However, under the law, employers are permitted to use a prospective employee’s past wages to determine salary only if the applicant voluntarily, without any prompting from the employer, provides the information.
Opponents to the law state that it is not comprehensive, as it does not address situations where an applicant might already be employed with the business or organization and is seeking a promotion or salary increase. Additionally, some argue that a more productive way of addressing the pay gap would be through transparency and disclosing information about salaries, rather than restricting what information may be shared.
Employers in NYC will need to update their hiring materials to remove any questions and references to a candidate’s previous wages. Additionally, managers and other individuals who conduct interviews need to be updated on the law so they understand that they may no longer ask about an applicant’s pay history. Employers may also wish to document situations where an applicant voluntarily discloses information about his or her previous wages.
The NYC law continues the State’s trend of enacting equal pay laws, such as the NY Pay Equity Act in 2015, which requires employers to provide equal pay for jobs that require “equal skill, effort, and responsibility” under similar work conditions, and Mayor DiBlasio’s 2016 executive order prohibiting city agencies from inquiring about wage history. Provisions that prevent employers from asking questions about an applicant’s past earnings have made their way into other states’ legislation, as well. For more information on similar laws, see our article on the Massachusetts Pay Equity Law.